Posts
In the words of Dr. John, I was in the right place but it must have been the wrong time. I was walking through a department store on the way to my car. Ronny (name changed) was happy to see me. He was ready to vent and I was the perfect target. Though Ronny has not been, nor will ever be a client, he has comfortably talked with me about his insurance, finances, and politics for a number of years. I don’t know who else serves this purpose in his life, but I was there. He was more than a little agitated and couldn’t wait to let loose.
He wanted to talk about all types of health insurance, not just his current Medicare but to relitigate his past problems (10 years ago!) with the Patient Protection and Affordable Care Act (Obamacare) and even Medicaid. His manager kept a healthy distance away. There were plenty of other sales staff on the floor. Ronny could take a “break”. Sally was at work. I had time. And who doesn’t appreciate a good rant?
“Did you hear that Trump is screwing up Medicare Part D? How much more are my drugs going to cost me?”
Again, since he isn’t a client, I have no idea exactly how he will be impacted. I know from previous conversations that he has an extensive medical history and is on over ten prescriptions, several of them quite expensive. I also know that he is about ten years older than me. Many seniors still work. They gain socially, emotionally, and even physically by getting out of the house and into the work environment. But seniors like Ronny, a guy putting in full-time hours, are probably motivated by their need for money. Any new expense could easily be one expense too many. Ronny wanted to know how HE would be affected.
The first step was to explain what we know and don’t know about what is going to happen as of January 1st. The difference may not make a lot of difference to Ronny or most seniors, but Donald Trump did not screw up Medicare. Like the PPACA during his first term, his M.O. is to sabotage our social safety net. Trump and his wrecking crew find ways to kneecap our systems and then scream when health care, food services, or housing are less than perfect.
I provided Ronny the shortest answer I could. Medicare Part D (Rx) was a poorly designed policy designed to protect the insurance companies and enrich the pharmaceutical companies. Heck, the law even prevented the government from negotiating with the drug companies over pricing. The plan essentially covered, with a deductible, about 75% of the first couple of thousand dollars. Then came the Coverage Gap (Donut Hole) where the patient was responsible for 100% of the costs. Thousands of dollars later, if the senior is still alive, their out-of-pocket drops down to 5% of the cost of the medication (Catastrophic Coverage) for the balance of the calendar year. I had some clients hit their Catastrophic Coverage level by February. Ronny was nodding his head.
The first meaningful tweak to Medicare Part D was made by the Biden Administration’s Inflation Reduction Act. The program was simplified and the maximum out-of-pocket for covered prescription drugs was capped year one at $2,000. The monthly cost of insulin would be $35 or less for seniors. Recommended vaccines would be covered at 100%. The federal government would begin to negotiate with the drug companies over pricing. The government shifted some of the costs associated with Medicare Part D to the insurers and the drug manufacturers. At this point Ronny said, “Yeah, I still had to pay $2,000 for my meds last year!” I reminded him that $2,000 was a lot less than the previous year.
Ronny (and possibly you) was growing restless. The insurance companies immediately pleaded poverty and the Biden Administration initiated a THREE YEAR demonstration plan to help to stabilize the costs. In other words, the government gave the insurance companies money to help defray the anticipated extra costs. Would they really last only three years or would they be extended like the Trump Tax Cuts? Democrats probably hoped that the subsidies would either be extended or reduced gradually over time. President Trump terminated the subsidies a year early. It is reasonable to assume that our costs for Medicare Part D and our prescriptions will increase in 2027.
“So I’m going to pay more next year? How much?”
Again, I have no idea. I urged him to contact his agent, have him price out the medications, and see which company is the best fit. The Maximum out-of-pocket for covered drugs will be $2,400 in 2027. He must make certain that his medications are covered by his Medicare Part D plan. The Inflation Reduction Act limited the premium increase to 6% of the national base rate. CMS has stated that the rate increases will we less than $10 per month, but I have no way of knowing how much either his premium or mine will jump. Sometime in late September we will all breath a sigh of relief or begin a couple month scramble to find a suitable option. Are you reassured? Neither was Ronny.
Why? Why would he (Trump) do this to seniors?
And this is truly nothing more than a matter of priorities. In April of this year, President Trump affirmed a key position of the authors of Project 2025 that the social safety net, Medicare, Medicaid, etc., is not the responsibility of the federal government. “Medicare, Medicaid, all of these individual things, they can do it on a state basis. They can’t do it on a federal.” (Donald Trump – April 2026)
And this is why we can’t have nice things. If the elected president chooses to prioritize war, reflecting pools, and coating old statues in gold, then YOUR health care is not a concern worth funding. The weakness of our system is the fear our elected representatives have of taxing us in an open an honest way. It is easier to build deficits. It is much easier to make the case for DEFENSE, even when we appear to be on the offense. Our national priorities, or at least the ones that are funded, change every election cycle.
As noted in last month’s blog, over 160,000 Ohioans are no longer covered through the PPACA. That number will increase through the year as your friends and neighbors are no longer able to balance insurance and their other expenses in this economy. Another 356,000 Ohioans are projected to lose their Medicaid coverage after January 1, 2027. We are looking at 5% of our state’s population losing their access to health care due to the passage of The One Big Beautiful Bill.
If a new president is elected in 2028 and successfully creates and passes a significant change to the funding of our health care system, there is no guarantee that the victor in 2032 or 2036 won’t treat that program like the East Wing and destroy it.
We need to have a serious discussion, as a country, about our national priorities. That conversation will take a lot longer than the one Ronny and I were having. And there is a very good possibility that a lot of us won’t like the outcome. Americans aren’t agreeable people. We tend to have our own (often contradictory) opinions and getting us to a consensus will be a real challenge. But the current haphazard way of deciding what is and isn’t important to us as a society does not appear to be helping the majority of Americans.
Dave
Health Insurance Issues With Dave
Picture – Time To Trumpify The House – David L Cunix
Yes, he went to Michael’s…
